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HR Challenges On a Global Scale

As HR directors at international companies focus on building a more competitive workforce across borders and oceans, they confront another challenge that could distract from that mission.

“Paradoxically, they will be doing this at the same time that the world is to varying degrees, de-globalizing,” Paul Sparrow, emeritus professor of international human resources management at Lancaster University Management School in Lancaster, England, told Forbes.

“As the public mood begins to shift, there is increased scrutiny being placed on the sourcing and shoring strategies of many multinationals and on their ability to regulate and manage their global supply chains,” he said. “Transparency is becoming the order of the day,” Global HR directors will face more pressure “to show that their organization does a lot of localization, transferring more skills and operations into host country operations,” as well, Sparrow added.

The increased pressure to automate also has implications when carried out on a global scale. Automation could lower costs without impacting customer service, but that involves cutting headcount, said Brian Kropp, HR practice leader at CEB. 

“Should they reduce headcount and achieve the cost savings and then hire new people as the need arises?” Kropp asked. “Or, should they invest significant resources in up-skilling their employees that will have their jobs eliminated with automation and prepare them for their next, different-in-kind role?”

While firms would have nearly always gone with the first option in the past, the greater focus on the positive role companies could play in the local markets they operate in has some contemplating going with the second option now, Kroop noted.

Regardless of the challenges, companies will be expected to compete in a global market. But there is plenty of evidence that some firms are failing to implement sufficient human resource management practices to compliment technological changes, Tech Featured reports

“The human resource function faces many challenges during the globalization process, including creating global mind-set within the HR group, creating practices that will be consistently applied in different locations/offices while also maintaining the various local cultures and practices, and communicating consistent corporate culture across the entire organization,” the article noted. “To meet these challenges, organizations need to consider the HR function not as just an administrative service but as a strategic business.”

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